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US Prosecutors Alleged That FTX CEO Used $100M Clients Funds For Politics

In the recent update on the ongoing lawsuit that the United States Department of Justice filed against the former chief executive official of the collapsed FTX exchange, it was revealed that the plaintiff had accused the CEO of using clients’ funds that are worth about $100 million for its activities in politics.

As the formal trial of the former CEO of FTX, Sam Bankman-Fried, for seven different charges of fraud continues to approach, the plaintiff has reportedly filed another allegation against the defendant. In the new indictment filed on Monday, the federal prosecutors accused SBF of stealing more than $100M, which he used in funding his political campaign from customers.

Furthermore, the plaintiff used the newly filed case to revisit the seven counts of fraudulent activities charged against Bankman-Fried, which he would be tried on in October, according to the report.

Apart from the recent charges, the former CEO of FTX is currently facing multiple counts of money laundering, wire fraud, fraud conspiracy, and for mismanaging the FTX exchange leading to its implosion.


In addition, he was accused of siphoning millions of FTX customers’ funds to support and repay debts on his other firm, Alameda Research. However, Sam Bankman-Fried pleaded that he was not guilty of the allegations charged against him by the federal prosecutors.

Sam Bankman-Fried Indicted For Mismanaging FTX Customers’ Funds

Meanwhile, in 2021, a report showed that everything was going on fine and well with SBF and his firm, to the extent that the CEO rapidly grew the net worth of the firm to $26 million, leveraging the bullish run that occurred in the crypto market that year.

However, the firm’s woes started in November 2022 when the crypto market plunged into a deep bearish run leading to the fall of Terra USD and LUNA token, which marked the collapse of many other crypto platforms associated with them. One of the companies affected was FTX, losing millions of dollars to the collapsed firm, according to the report.

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During the crisis, rumors had it that FTX plans to merge with Alameda, a hedge fund owned by FTX CEO. The news caused panic in the market as many customers filed for withdrawal on the platform, causing heavy withdrawal orders, which negatively impacted the liquidity pool of the firm, causing it to become insolvent eventually.

However, before FTX went bankrupt, a report revealed that SBF had gained fame among US politicians, especially the democrats, as he generously spent over $100 million in client funds in funding several political campaigns, according to the lawsuit document.

Furthermore, the United States Manhattan’s Attorney’s Office indicted Bankman-Fried for trying to leverage his newly found fame among politicians to persuade the US Congress and regulator bodies to adopt and support the legislations he believed would favor FTX operations.

The US District Court Slated SBF’s Trial For October 2

Although the new indictment did not list the names of the accomplices that helped SBF to execute his campaign donations, nonetheless, the lawsuit documents from the court named the two top executives that aided Bankman-Fried in carrying out his political rallies as Ryan Salame and Nishad Singh.

Meanwhile, Nishad Singh, who was the engineering chief for FTX, had earlier in February pleaded guilty to fraud and violations of campaign finance regulations. According to the report, the executive gave the Democratic electoral prospects a cumulative donation of about $9.7 million. He reportedly admitted in court to being aware that the funds belong to FTX clients.

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Furthermore, the election data revealed that Ryan Salame, the Bahamian FTX branch’s co-CEO, gave the Republican prospects in the US 2022 election campaign a whopping sum of $24 million. However, federal prosecutors are yet to charge the CEO regarding his involvement.

But, Salame was reportedly named in another lawsuit on Monday where he was asked to testify against SBF during the upcoming trials in exchange for a deal to plead not guilty. However, his attorney recently told the federal prosecutors that if Salame is invited to witness, he will activate his Fifth Amendment right, which protects him against self-incrimination.

Meanwhile, Judge Kaplan recently revoked Bankman-Fried’s bail order, demanding him in jail for trying to tamper with a witness two times. His trial is coming up on October 2, 2023, according to the report.

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Brenda Collins

Brenda Collins is a seasoned crypto news writer with a deep passion for blockchain technology and its transformative potential. With years of experience in the industry, she has honed her skills in delivering concise and insightful analysis, making complex concepts accessible to a wide audience. Brenda's dedication to staying up-to-date with the latest developments in the crypto world ensures her readers receive accurate and timely information.

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